Test Bank For Microeconomics, 12th Edition All Chapters - 9781260962093.pdf

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Microeconomics,e5ee(Hubbard/O'Brien)
Chaptere2e Trade-offs,eComparativeeAdvantage,eandetheeMarketeSystem

2.1 ProductionePossibilitieseFrontierseandeOpportunityeCosts

1) Scarcity
A) stemsefrometheeincompatibilityebetweenelimitederesourceseandeunlimitedewants.
B) canebeeovercomeebyediscoveringeneweresources.
C) canebeeeliminatedebyerationingeproducts.
D) iseaebiggereproblemeinemarketeeconomiesethaneinesocialisteeconomies.e
Answer:e A
Diff:e2
PageeRef:e38e
Topic:e Scarcity
*:e Recurring
LearningeOutcome:e Micro-
1:eIdentifyetheebasiceprincipleseofeeconomicseandeexplainehowetoethinkelikeeaneeconomist.
AACSB:e Analyticethinkinge
SpecialeFeature:e None

2) TeslaeMotorsemanufacturerseitsecarseateaeplanteineFremont,eCalifornia.eAtethiseplant,eTeslaeiseable
etoetakeeadvantageeofetheehigheleveleofetechnicaletrainingepossessedebyeitseAmericaneworkers,ebuteite

alsoesacrificesetheeabilityetoepayelowerewagesehadeitechosenetoeopeneitseplanteineaelow-
wageecountryesucheaseMexico,eIndia,eoreChina.eInedecidingetoeopenetheeFremonteplant,eTesla
A) facedenoetrade-offsebecauseeemployingemoreetechnically-skilledeworkerseincreasedeefficiency.
B) facedeaetrade-offebetweenehigherecosteandelowereprecision.
C) adoptedeaenegativeetechnologicalechangeebecauseeitechoseehigh-skilledeworkerseoverelow-
paideworkers.
D) erodedesomeeofeitsecompetitivenesseinetheeluxuryeelectricecaremarketebecauseeofeitseincreasedec
osteofeproduction.
Answer:e B
Diff:e2
PageeRef:e37eTo
pic:e OpportunityeCost
LearningeOutcome:e Micro-
3:eDiscussedifferentetypeseofemarketesystemseandetheegainsethatecanebeemadeefrometrade.
AACSB:e Analyticethinking
SpecialeFeature:e ChaptereOpener:eManagerseateTeslaeMotorseFaceeTrade-Offs




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3) Theeprincipleeofeopportunityecosteisethat
A) ineaemarketeeconomy,etakingeadvantageeofeprofitableeopportunitieseinvolvesesomeemoneyecost.
B) theeeconomicecosteofeusingeaefactoreofeproductioneisetheealternativeeuseeofethatefactorethateisegi
veneup.
C) takingeadvantageeofeinvestmenteopportunitieseinvolvesecosts.
D) theecosteofeproductionevariesedependingeonetheeopportunityeforetechnologicaleapplication.e
Answer:e B
Diff:e2
PageeRef:e39eTo
pic:e OpportunityeCost
*:e Recurring
LearningeOutcome:e Micro-
1:eIdentifyetheebasiceprincipleseofeeconomicseandeexplainehowetoethinkelikeeaneeconomist.
AACSB:e Analyticethinkinge
SpecialeFeature:e None

4) Theeproductionepossibilitiesefrontiereshowsethee
combinationseofetwoeproductsethatemayebeeproducedeineaeparticularetimeeperiodewitheavailableer
esources.
A) minimumeattainable
B) maximumeattainable
C) only
D) equitable
eAnswer:e B

Diff:e2 PageeRef:e38
Topic:e ProductionePossibilitieseFrontiers
*:e Recurring
LearningeOutcome:e Micro-
3:eDiscussedifferentetypeseofemarketesystemseandetheegainsethatecanebeemadeefrometrade.
AACSB:e Analyticethinkinge
SpecialeFeature:e None

5) Theeproductionepossibilitiesefrontieremodeleshowsethat
A) ifeconsumersedecideetoebuyemoreeofeaeproducteitsepriceewilleincrease.
B) aemarketeeconomyeisemoreeefficienteineproducingegoodseandeservicesethaneiseaecentrallyepl
annedeeconomy.
C) economicegrowthecaneonlyebeeachievedebyefreeemarketeeconomies.
D) ifealleresourceseareefullyeandeefficientlyeutilized,emoreeofeoneegoodecanebeeproducedeonlyebyepr
oducingelesseofeanotheregood.
Answer:e D
Diff:e2 PageeRef:e38
Topic:e ProductionePossibilitieseFrontiers
*:e Recurring
LearningeOutcome:e Micro-
3:eDiscussedifferentetypeseofemarketesystemseandetheegainsethatecanebeemadeefrometrade.
AACSB:e Analyticethinkinge
SpecialeFeature:e None


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6) Theeproductionepossibilitiesefrontieremodeleassumesewhicheofetheefollowing?
A) Labor,ecapital,elandeandenaturaleresourceseareeunlimitedeinequantity.
B) Theeeconomyeproduceseonlyetwoeproducts.
C) Anyeleveleofetheetwoeproductsethatetheeeconomyeproduceseisecurrentlyepossible.
D) Theeleveleofetechnologyeisevariable.e
Answer:e B
Diff:e2 PageeRef:e38
Topic:e ProductionePossibilitieseFrontiers
*:e Recurring
LearningeOutcome:e Micro-
3:eDiscussedifferentetypeseofemarketesystemseandetheegainsethatecanebeemadeefrometrade.
AACSB:e Analyticethinkinge
SpecialeFeature:e None

7) Theeattainableeproductionepointseoneaeproductionepossibilityecurveeare
A) theehorizontaleandeverticaleintercepts.
B) theepointsealongetheeproductionepossibilitiesefrontier.
C) theepointseoutsideetheeareaeenclosedebyetheeproductionepossibilitiesefrontier.
D) theepointsealongeandeinsideetheeproductionepossibilityefrontier.e
Answer:e D
Diff:e2 PageeRef:e38
Topic:e ProductionePossibilitieseFrontiers
*:e Recurring
LearningeOutcome:e Micro-
3:eDiscussedifferentetypeseofemarketesystemseandetheegainsethatecanebeemadeefrometrade.
AACSB:e Analyticethinkinge
SpecialeFeature:e None

8) Theepointseoutsideetheeproductionepossibilitiesefrontiereare
A) efficient.
B) attainable.
C) inefficient.
D) unattainable.
eAnswer:e D

Diff:e2 PageeRef:e39
Topic:e ProductionePossibilitieseFrontiers
*:e Recurring
LearningeOutcome:e Micro-
3:eDiscussedifferentetypeseofemarketesystemseandetheegainsethatecanebeemadeefrometrade.
AACSB:e Analyticethinkinge
SpecialeFeature:e None




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Figuree2-1




9) ReferetoeFiguree2-1.ePointeAeis
A) technicallyeefficient.
B) unattainableewithecurrenteresources.
C) inefficienteinethatenotealleresourceseareebeingeused.
D) theeequilibriumeoutputecombination.e
Answer:e C
Diff:e1 PageeRef:e39
Topic:e ProductionePossibilitieseFrontiers
*:e Recurring
LearningeOutcome:e Micro-
2:eInterpreteandeanalyzeeinformationepresentedeinedifferentetypeseofegraphs.
AACSB:e Analyticethinkinge
SpecialeFeature:e None

10) ReferetoeFiguree2-1.ePointeBeis
A) technicallyeefficient.
B) unattainableewithecurrenteresources.
C) inefficienteinethatenotealleresourceseareebeingeused.
D) theeequilibriumeoutputecombination.e
Answer:e A
Diff:e1 PageeRef:e39
Topic:e ProductionePossibilitieseFrontiers
*:e Recurring
LearningeOutcome:e Micro-
2:eInterpreteandeanalyzeeinformationepresentedeinedifferentetypeseofegraphs.
AACSB:e Analyticethinkinge
SpecialeFeature:e None




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